As E-Commerce Matures, Alibaba Counts On Non-Core Business For Future Growth

Alibaba’s results for the quarter ended December 31, 2016 show that the Chinese online commerce company continues to grow at an impressive rate, with total revenue of RMB53.2 billion (US$7.7 billion), an increase of 54% year-over-year. Revenue from its core e-commerce business, however, increased at a more moderate 42% year-over-year, while its strongest revenue growth during the quarter came from non-core businesses such as cloud computing and media and entertainment.

The results indicate that Alibaba may be facing a problem that was once considered impossible: a lack of new Chinese customers for its core e-commerce businesses. Active annual buyers stood at 443 million in December, up 8.8% year-on-year, and up only four million users from the prior quarter, or less than 1%.

Those buyers may be spending more money per purchase, thus suppor...

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